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Google to Pay Record Fine Over Privacy Violations

Google agreed to pay a record $22.5 million fine to the Federal Trade Commission on Thursday. The fine was levied against the search giant by the FTC because it broke a promise involving its activity with Apple’s Safari browser.

Google had promised not to monitor the online activities of Safari browser users as long as the users didn’t change their settings to permit such tracking. The FTC alleged that Google broke this promise by placing cookies on the devices of Safari browser users when they visited sites served by the company’s DoubleClick ad network. As a consequence, DoubleClick was able to show those users targeted ads, even when the browser was set in “Do Not Track” mode.

Google is not admitting any wrongdoing in this matter. For its part, it claims that something in Apple’s browser caused an unintentional violation. The FTC isn’t buying it, however. Dan Vladeck, the FTC director of the Bureau of Consumer Protection, said that “A company like Google, which is a steward of information for hundreds of millions of people has to do better.”

The issue was first spotted at least as far back as February by graduate student Jonathan Mayer, who noticed that he was still getting targeted ads from Google even though he had tried to block the company from tracking his cookies. “This seems to be the kind of thing the company shouldn’t be doing,” he said at the time.

The fine levied against Google is the largest penalty ever issued by the FTC against a company for violating a privacy agreement. It could be a sign of things to come. James Kohn, associate director of enforcement for the FTC’s Bureau of Consumer Protection, said that “This is the first purely consumer privacy enforcement…Having a record-setting fine like this is not a comfortable position for Google in terms of publicity.”

That doesn’t mean this fine will make Google squirm due to the financial hit. The search giant made more than $12 billion in revenue in its most recent quarter. It will quickly recoup the money. And keep in mind how Google is making its money: targeted Internet ads. With that much cash at stake, it’s not surprising that regulators suspect Google’s motives.

It is possible that Google is completely innocent of this privacy violation. But even if they are, Vladeck is right: the search giant has to do better. Back in 2010, due to privacy violations relating to the now-defunct Buzz social networking service, Google made an agreement with the FTC (following an investigation). In this agreement, Google accepted 20 years of oversight concerning privacy and promised not to mislead consumers on privacy issues. It knew it was being watched, yet it still stumbled on this Safari issue. With targeted online advertising the lifeblood of the company, can we trust Google to do better going forward?